Land Law

Publication year2020
AuthorTEO Keang Sood LLM (Harvard), LLM (Malaya); Advocate and Solicitor (Singapore and Malaya); Professor, Faculty of Law, National University of Singapore.
Published date01 December 2020
Citation(2020) 21 SAL Ann Rev 660
Date01 December 2020
I. Co-ownership
A. Determination of shares of co-owners

21.1 That the determination of the shares of co-owners in a property is a fact-centric exercise is illustrated in Damodaran s/o Subbarayan v Rogini w/o Subbarayan.1 The defendant and her husband had acquired a Housing and Development Board flat as joint tenants. The High Court found that the married couple were joint tenants in equity as well as in law, having regard to the observation of the Court of Appeal in Lau Siew Kim v Yeo Guan Chye Terence2 (“Lau Siew Kim”) regarding property ownership in a typical marital relationship.

21.2 Subsequently, their son, the plaintiff, was added as a third joint tenant three years later and the plaintiff took over the outstanding balance of the mortgage loan in respect of the flat. The defendant's husband died a month later. The plaintiff argued that his share of the flat, relative to the defendant's, would only depend on the respective contributions each of them had made. In other words, it was immaterial what the defendant's husband's contributions had been, and what beneficial interest the defendant's husband previously had in the flat.

21.3 The court found that the circumstances in which the plaintiff was added as a third joint tenant did not change the manner in which the defendant and her husband held their interest in the flat, that is, jointly with the plaintiff individually holding the remainder of the beneficial interest as a tenant in common. Reference was made to Low Yin Ni v Tay Yuan Wei Jaycie3 where the Court of Appeal recognised that in equity,

some co-owners may hold their interests jointly as between each other (like the parents in that case), while other co-owners hold individual shares (like the son and daughter-in-law in that case).

21.4 Upon the death of the defendant's husband, the defendant became the sole beneficial owner of that interest by survivorship. The defendant and the plaintiff remained legal joint tenants (until the defendant severed that joint tenancy in June 2019), and were beneficial tenants in common with the plaintiff's share being proportionate to his contribution. In the result, no part of the defendant's husband's beneficial interest passed to the plaintiff upon his death.

21.5 With regard to the acquisition costs of the flat, the court found that the costs of the original purchase were borne by the defendant and her husband. As for the additional costs (such as valuation, stamp and legal fees) when the plaintiff was added as a joint tenant, the plaintiff contributed a share of these with the defendant. In total, the plaintiff's contribution towards the lump sum payment for the discharge of the original mortgage loan, the new mortgage loan and in respect of valuation, stamp and legal fees, was ascertained by the court to be $171,974.55.

21.6 On renovation costs to the flat, the Court of Appeal in Lau Siew Kim4 had accepted that:5

… contributions to the cost of repairs or renovation of a property may be relevant when computing a party's contribution to the purchase price of property [and that] … where a property is redeveloped closely after purchase and where its value is increased by the redevelopment, contributions to the costs of redevelopment can be relevant in determining the respective proportion of contributions to the purchase price of the property for the purposes of a presumption of resulting trust. [emphasis in original]

However, the court in the instant case found that the defendant and her husband had given the plaintiff $40,000 from their joint account for such expenses. Accordingly, it followed that the renovation expenses of $35,520 were entirely paid for by the defendant and her husband, and the plaintiff could not count the renovation costs towards his share in the flat.

21.7 The court rightly disallowed the plaintiff's claim for payment towards utilities, service and conservancy charges, and property tax from 2001 to date to be taken into account in calculating his share of

the flat. In Lau Siew Kim, the Court of Appeal had held that only “direct contributions” to the purchase price would be taken into account.6

21.8 In the result, the court held that the plaintiff was entitled to a share in the flat proportionate to the financial contribution he had made and that his share in the flat did not increase on account of the defendant's husband's death. As the total costs of acquisition of the flat were $379,233.60 and the plaintiff's share was $171,974.55, the court held that the plaintiff had a beneficial interest of 45.35% in the flat and the defendant a 54.65% share therein.

B. Severance of joint tenancy

21.9 Does an interim judgment in divorce proceedings ordering the transfer of property sever a joint tenancy? This issue was considered in Toh Ah Poh v Tao Li7 where Tan and the appellant, who were husband and wife respectively, were joint tenants of a flat. Subsequently, the parties obtained an interim judgment dissolving the marriage. Tan and the appellant agreed, by cl 3(a) of the interim judgment, to have their matrimonial flat transferred to the latter, and by cl 3(b) to have their investment private property (“the apartment”) transferred to Tan upon payment of $60,000 in cash to the appellant. In due course, the court order dissolving the marriage was made absolute.

21.10 After the decree was made absolute, Tan married the respondent and they lived in the apartment together, but the $60,000 had not been paid to the appellant.

21.11 On the death of Tan, the issue arose whether the joint tenancy in the apartment had been severed. If it had not, then upon Tan's death, the whole of the interest in the apartment would devolve to the appellant by way of the right of survivorship, which is the hallmark of a joint tenancy. The respondent argued that the joint tenancy had been severed.

21.12 The High Court8 ruled in favour of the respondent and the appellant appealed. In dismissing the appeal, the Court of Appeal held that cl 3(b) severed the joint tenancy over the apartment and made Tan, the deceased, its sole owner. This clause also gave the appellant the entitlement to the payment of $60,000. The appellant's attempts

to distinguish Sivakolunthu Kumarasamy v Shanmugam Nagaiah9 (“Sivakolunthu”) had no merit.

21.13 The Court of Appeal further opined that cl 3(b) of the order did not confer on Tan an “option to elect” to take over ownership of the apartment. It was part of an order of court and was couched in mandatory terms (“shall be transferred to” Tan). The appellant's argument might have been more persuasive if cl 3(b) had been worded in permissive terms (such as “if Tan so chooses”) or had been limited in time (such as being expressed to cease automatically to have effect if the necessary action to sever the joint tenancy was not taken by a specified date). Clearly, those were not the situation here. Any argument that cl 3(b) was only “an option to elect” ignored the context of the entire cl 3 in the interim judgment, in particular cl 3(a). The interim judgment contemplated that each party would have one property after the divorce, with the appellant becoming the sole owner of the matrimonial flat and Tan becoming sole owner of the apartment.

21.14 The appellant's submission that the interim judgment did not sever the joint tenancy, because the parties' mutual agreement “superseded” the court order and the parties had no mutual intention to sever, was inconsistent with the authorities. Lee Hong Choon v Ng Cheo Hwee10 unequivocally affirmed that the legal effect and force of consent orders are not derived from the agreement made between the parties, but from the court order which finally and conclusively determines the rights of the parties. The same can also be seen in Public Trustee v Grivas.11

21.15 There was also no uncertainty as to what shares or proportions the parties should hold as tenants in common.12 By agreeing that the matrimonial flat referred to in cl 3(a) be transferred to the appellant without the need for her to make any refund to Tan's Central Provident Fund account, that the apartment be transferred to Tan upon payment of $60,000 to the appellant and that all other assets would remain in their respective sole names, the parties had agreed on their respective shares in the matrimonial assets, not by percentage but by specie. The mechanics of transferring the properties to their respective sole owners were only practical matters for the parties and their lawyers to carry out.

21.16 The Court of Appeal also rightly held that the four unities of a joint tenancy (as to time, title, interest and possession) did not remain.13 As was made clear in Sivakolunthu,14 whether the case concerned an interim judgment (known as a “decree nisi”) or a final judgment (called a “decree absolute”) made no difference to the legal consequences intended and mandated by the court's orders.

II. Contractual licence

21.17 The High Court decision in Ram Niranjan v Navin Jatia15 was considered in the previous Annual Review.16

III. Priority of competing claims
A. Purchaser's equitable lien against other creditors in a bankruptcy

21.18 The High Court decision in DBS Bank Ltd v Davis, Colin Niel17 was considered in the previous Annual Review.18

B. Priority of judgment creditors

21.19 In Singapore Air Charter Pte Ltd v Peter Low & Choo LLC,19 the competing claims were that of the appellant and the first respondent, both of whom were judgment creditors of Danial Patrick Higgins (“DP”). The second respondent was a secured creditor of DP and sold the property mortgaged to it and the sale was completed on 13 December 2018. At the time of the sale of the property, only the first respondent's Form 96 Order, obtained pursuant to O 47 r 4(1)(a) of the Rules of Court, was registered against the property; that of the appellant had already lapsed on 18 April 2018. However, the appellant's Form 83 Writ of Seizure and Sale, obtained...

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